Saving Grandma

Should Medicare be a requirement? Or should seniors be allowed the option of foregoing medical coverage and just taking cash instead? Ezra Klein lays out the obvious objection:

As a society, we are not willing to let people die painfully in the street, even if they have previously made decisions that would lead to that outcome. In reality, what terrifies all of us is what happens after someone takes the cash and then gets sick.

Let’s run through the cash-grant world: At age 65, grandma decides to purchase no health-care plan, as she figures she’ll just get one when she gets sick, or maybe just get one next year, or perhaps she just doesn’t want to spend money extending decrepitude. But then she has a stroke and gets rushed to the hospital. Someone is paying for that emergency care. It might be the hospital. It might be the taxpayers. But it’s someone….[Or] perhaps you just build in a requirement that grandma has to at least purchase a catastrophic care plan. The problem with catastrophic care plans, of course, is that they often don’t cover the care you need. That’s why they’re cheaper. So the question is what happens when grandma needs more than the catastrophic care plan will provide — and when you’re dealing with seniors, that’s a “when,” not an “if.”

This is all true, but I think there’s something else at work here that no one really likes to admit: not all medical care is emergency care. So if grandma gets sick and can’t afford her non-emergency treatment — drugs, chemotherapy, hospice care, hip replacement, you name it — who’s going to pay? “Someone,” says Ezra, and he’s right. And most likely that someone is her kids. Which is to say, you.

I think this is sort of the dirty little secret of universal care for seniors. Obviously we all pay Medicare taxes because we think we’ll benefit from receiving Medicare ourselves in our old age. But there’s also this: We would all rather pay a modest annual amount to cover everyone over 65 than be on the hook for an eventual decision to either (a) let grandma die of cancer or (b) bankrupt ourselves paying for grandma’s proton therapy. This is, after all, about the most wrenching kind of decision you can imagine, and today the average worker pays less than $2,000 each year to avoid ever having to make it. That’s a pretty good deal. But it’s only a good deal if it genuinely relieves you of the prospect of having to decide whether to save grandma’s life. If she’s allowed to opt out, that prospect becomes very real all over again and the deal suddenly looks very crappy indeed. For that reason, grandma doesn’t get a choice.

There are other reasons that it’s a bad idea to let grandma opt out of Medicare too. But this one is probably both the most important and the least likely to be talked about.